Cosmetic procedure on credit card

Lminklet on 29/06/2018 - 12:18

Hey,

I'm considering getting a 0% Purchase credit card for a cosmetic procedure, to the tune of $17k. I have roughly $20k in savings/shares but I would rather keep that where it is and pay the balance over about 1 year. My specifics are, earnings roughly $160k (contractor tho so fluctuates) and can put aside $4k a month if I scrimp and save. So I think I should be fine with repayments/safety net.

I don't have any credit cards in Australia but I have a total of $10k limits with $2k debt in the UK. I really should close one of those cards off tbh

I'm just wondering if this is the best way to go, I've never really used a credit card for a purchase this size. Actually I've never made a purchase this size at all…

Health & Beauty

Comments

  • zonra on 29/06/2018 - 12:26

    Just find out what sort of fees/surcharge you might get hit with.
    If you’re ok with that and the interest over the payment terms then I don’t see why not.
    Assuming you are planning to pay with the UK cards be mindful of any foreign exchange fees as well.

    • minklet on 29/06/2018 - 14:10

      No, I'd be looking to take out another card, if that is actually possible for that amount.

  • Diji1 on 29/06/2018 - 12:27
    +3

    Bad idea.

    Wait 4 months and then do it without credit.

    • djones145 on 29/06/2018 - 12:41
      +3

      wait 4 months, sae the money, use credit card and pay it off right away, score points!

  • QW3RTY on 29/06/2018 - 12:42

    I'm about to make a major purchase myself and got myself a 6 month interest free credit card instead of using cash.
    The interest I make on the cash in my savings account will be greater than the card's annual fee — so it made sense for me to take the card out for the purchase.

    Is there a 0% purchase card that will give you a $17,000 credit limit?

    • minklet on 29/06/2018 - 14:32

      I actually don't know, but I guess I would take the maximum they allowed and make up the shortfall in my savings

  • buckster on 29/06/2018 - 12:49
    +1

    Just make sure you pay it off in whatever period you're given, because some of those cards charge you full equivalent interest for the whole period if you miss a payment

  • HighAndDry on 29/06/2018 - 12:50
    +1

    Don't put cosmetic procedures on credit when you have fluctuating income. Pay it off, or wait until you can pay it off. The risk of having a ~$17k balance on a credit card that you can't guarantee will be paid off before interest is charged, is crazy high and not worth it for a cosmetic procedure.

    • QW3RTY on 29/06/2018 - 13:45
      +1

      can put aside $4k a month if I scrimp and save

      That's $48,000 in 12 months.
      OP also has $20,000 of liquid assets.

      It seems that there's enough security to pay a $17,000 interest free debt off over 12 months.
      If OP is unable to pay off the balance via the $4,000/month payments, they can use the liquid assets to pay the balance before the credit deadline.

      • minklet on 29/06/2018 - 14:13

        Yeah this is what I was thinking. I COULD pay it off in one go, but I think I could make that money work (a little) better elsewhere IF the right credit circumstances are there.

      • HighAndDry on 29/06/2018 - 15:15

        I'm probably a bit more risk averse. OP is a contractor, and no matter history of past earnings it means that (knock on wood), it could fall to zero at any time. Likewise liquid assets which aren't cash. Are blue-chip stocks safe? Yes. But is it possible for them to lose 10% of their value very quickly? Also yes - just… very unlikely.

        The key point though, is that this is a cosmetic procedure. I see absolutely no reason why OP can't just save for 6 months and pay it off then.

  • Ryanek on 29/06/2018 - 13:36
    +3

    I paid for most of my wedding on a credit card which I paid off straight away. Scored enough points for the honeymoon flight overseas.

    • minklet on 29/06/2018 - 14:13

      This is another thing I hadn't even really considered, points mean prizes!

  • Sofie519 on 30/06/2018 - 11:58

    r you sure the 0% interest free period isnt the normal (aprox) 55day? Which then becomes 19-30% interest pa? Hopefully your investments are returning more than that each year.
    I would be very interested to know of any unsecured loan (Credit Card) that would offer you 0%
    The only other credit card option I could think of, provided you qualify would be interest free balance transfer for x months.

    you should also consider that your contracting work may face sudden changes, and to rely on it may not be the best option.

    Assuming your cosmetic surgery is non critical, would saving for a few months be completely out of the question?

  • cimrak on 30/06/2018 - 12:55

    My partner had a cosmetic procedure 2yrs ago for approx $13k. We had already saved up the money to pay cash.

    Instead, I paid via an existing credit card to get Qantas points and then applied for a new credit card which had an 18-month 0% balance transfer offer. Then we set up scheduled monthly CC payments from our account which had the cash sitting in it so that the credit balance would be paid off within 16 months (giving us a spare 2 months just in case).

    • minklet on 03/07/2018 - 11:42

      This seems like the best option

  • bobbified on 30/06/2018 - 19:41
    +2

    $17k sounds like a boobjob. Is that going to increase your earning ability? Contact the ATO and ask if you can claim a tax deduction.

    (actually, no don't! lol).

    As a contractor, remember to factor in the amount of time you're taking off for the procedure without pay. I personally find that making up for a period of no pay isn't always easy. That is, no pay plus additonal spending equals bigger hole in budget.

    • minklet on 03/07/2018 - 11:42

      Haha no, I'm a guy. Could be fun tho

      Fortunately I have a very relaxed manager who will let me work from home during the time off, but yeah I'll likely lose about a week.

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